Intermediate school would increase tax levy
September 27. 2013 9:29AM
A reallocation of capital outlay certificates won’t increase taxes if Brandon Valley School District voters approve a proposed intermediate school next year.
But the district’s tax levy would increase. That information was not included in the Sept. 18 Challenger report.
District Business Manager Paul Lundberg explained the proposed intermediate school – estimated at $12 million – would be funded through general obligation bonds of $5,950,000 and capital outlay certificates of $6,160,000.
Lundberg has suggested utilizing $5,950,000 from general obligation bonds that would be paid back at $450,000 annually over 20 years. Based on several assumptions – 3 percent valuation growth the first five years, 2 percent growth in years 6-10, and 1 percent growth for the last 10 years – Lundberg said this would equate to a tax levy of approximately 28 cents per $1,000.
The remaining $6,160,000 would come from capital outlay certificates. That would be paid back over 15 years at $525,000 annually.
“We’ve been paying about $600,000 annually in debt service,” Lundberg said. “So we’re used to it but we’ve been freed up here a couple of years, which has allowed us to do things like the wireless technology.”
Lundberg explained that district taxpayers are already paying about $3 per $1,000 of valuation. Under this proposal, Lundberg said property taxes would not change.
“The beauty of certificates in this fund is that there would be no increased tax levies based on the fact that we are already levying $3 per $1,000 in this fund,” he said. Debt service at this level would equate to 0.39 of the total $3 levy.
“We would merely be utilizing the current available money to assist in paying off the building project,” he said.
Although secure entrances at the middle and high school have been explored, Lundberg said the estimated $12 million proposal does not include those projects.
“We should look at the intermediate school and secure entrances as two separate projects,” Lundberg advised.
Superintendent Dave Pappone said architect drawings were due to the district for review last week.
“Hopefully, we’ll come back to the board sooner than later as to whom should be the architect,” he said.